The tax administration is profiling thousands of businesses and traders every month for gaming the system, a drill that has helped in boosting Goods and Services Tax (GST) receipts, revenue secretary Ajay Bhushan Pandey said on Saturday.

The profiling of tax payers is based on the tax evasion risk they pose and such abuse of the system needs to be stopped, Pandey said at a post-budget industry interaction in Chennai in the presence of finance minister Nirmala Sitharaman and other senior officials. Pandey said that a large number of tax payers are fully compliant with tax laws and that officials make sure there is no overreach while dealing with assessees.

Sitharaman told academicians and policy experts at the interaction that GST receipts have exceeded 1 trillion in each of the last three months and is going up. “State finance ministers have told us about the loopholes due to which revenue was getting lost. To address these loop holes, we have taken a lot of steps. We think it (GST receipts) will improve," said Sitharaman.

Pandey said the authorities are combing through data collected on income tax, GST, export and import transactions and are matching information from different sources to find where revenue leakage was happening. “There are 1.2 crore registered GST payers. A large number of tax payers are compliant. But a fraction of them, in thousands, are not. We are getting red flag reports," the revenue secretary said, adding that the mismatches identified are followed up to find why taxes are not paid.

The authorities are doing risk-based profiling of the assessees who “try to game the system and take undue refunds," the secretary said. “It is tax payer’s money. If someone is taking undue advantage, we have a shared responsibility to stop it," he said.

The revenue secretary also said that in the case of the direct tax dispute resolution scheme announced in the budget, settlement of the cases will be done through an electronic interface. People should avail of the scheme in as many cases as possible, he said.

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